How Ford And GM Can Save Themselves!

// Last updated on //

Oil has collapsed from $147 to under $50 a barrel. Merrill Lynch says it is on its way to $25 a barrel.  The oil nations cash flow is drying up, and they are going to be desperate.  At this price, technologies for tapping new resources like clean coal, the tar sands in Canada and oil shale in the United States are no longer cost effective.

Ford and GM make poorly designed and unpopular cars with the exception of a rare few.  Most are quality disasters and either cost much more than equivalent higher quality foreign vehicles or are just plain low quality junk.

In stark contrast, Ford and GM, and even Chrysler to a degree, make the best trucks in the world.  With gas prices plummeting, people will return to their historic love of trucks!!  This is especially true of men, who adore their trucks.  C’mon guys, do you really enjoy driving that Prius?

There is so much utility in a well-designed truck, it is incredible how much more useful it is day to day than the average car.  No Civic can carry four passengers AND a refrigerator, 52″ television and a living room chair at the same time!  And we would love to see a Honda Fit tow a camper, a boat or any other payload for that matter.  This makes trucks not only useful for home owners and other average Joes, but it also makes them the only practical solution for most businesses. And with gas prices plummeting to what Huffington Post says could be $1.00 a gallon, even the worst gas guzzlers aren’t impractical.

Trucks burn more fuel.  OK, but gas is plummeting.  If oil gets to $25 a barrel, gas could get to as low as a buck!!  Why would anyone purchase a Prius when, at its price, it would take you a century to save back the difference in fuel on a basic economy car if gas remains at $2.00 a gallon!!  And all indications are that it will!

Businesses that succeed focus on their strengths, and we are not talking about the disaster “Ford Focus”.  The Big 3 MUST make the best trucks in the world.  Raise the quality bar.  Raise the efficiencies.  Make them what America needs and wants.  Make them affordable.  This will make them untouchable by foreign auto makers, most of which couldn’t manufacture a decent truck if they tried.

That is not to say the foreign manufacturers aren’t up to the challenge.  Honda has the Ridgeline; it is a clear threat.  It won truck of the year in 2006 in North America.  Toyota has the Tundra, and it is looking more like an American truck every day!!  The big three cannot surrender that market and survive.  GM and Ford have a huge line of trucks and they cannot be caught unless they surrender.  They also manufacture a huge line of commercial trucks that are world-renowned.

Step one for the survival of GM and Ford.  Throw out the auto business; don’t compete with the foreign manufacturers, they have been whipping your butts for years.  Ford and GM compacts are the jokes of the industry.  Make trucks!!  But take the efficiencies and make the best trucks in the world and make them true quality.

We have heard the talk by JD Powers of a narrowing in the quality differences between domestic and foreign, but we don’t see it as true.  The newer Ford SUV we discarded for a Toyota burned over a quart of oil a month (which Ford said was normal) and had major electronic problems starting at 60,000 miles.  We don’t even want to discuss all the problems we had with our Chrysler.  It would be an entire article all by itself.  We have been happy owners of Toyotas and Hondas since.

We are talking about true quality.  Engines that do not burn oil.  Quality comfortable interiors that make one feel like they are on par with the foreign competitors.  Make efficiency and power improvements. They will need dependability that is untouchable, so people know these American made vehicles, with proper care, will not see a problem for 100K miles or better.  Add to it an untouchable warranty, which you won’t need to worry about much if you make quality vehicles, and voila.  Throw in service for 36K miles and beat Japan’s prices and you have a winner.  Ford and GM with various models have proven it can be done, but their record is spotty with many quality disasters mixed in.

The truck market is the only market where American “car” manufacturers still have the lead, and they have it world wide.  It is counterintuitive, because we just faced artificially inflated oil prices that have put a major hurt on our economy, but it is right.  Use it to crush the competition, and leave the econo-box business to Hyundai.

Facebook Comments

Related Post

NEXT READ:  10 Biggest Political Lies of 2008

10 Responses to "How Ford And GM Can Save Themselves!"

  1. John Wells   December 6, 2008 at 12:37 pm

    Oil at $25 a barrel represents an economic end state so horrifying as to be literally unimaginable. So unless you think the Great Depression is a good idea rooting for $25 a barrel oil is really not so smart. Our current recession will end, probably sooner than most folks believe. When it does the demand for oil will return the price well above $70 a barrel, which is required for most of the newer sources (deep water gulf, Canadian tar sands, etc.) to be functional business models.

    As far as Detroit only building trucks, Japan has attacked the American auto industry at every turn. If the only remaining market niche is large pickups and SUVs, do you honestly thing Japan is incapable of trouncing the big 3 there as well? Really? Have you seen the new full size Tundra? Saying just quit and give most of the market to the Japanese is really not good advice I’m afraid. The big 3 are quite capable if competing on every level. I don’t think there problem is lack of engineering. It is simply a matter of execution. They know what to do, they just need the courage and leadership to do it. Or they should go out of business and make way for those businesses which can compete effectively.

    Reply
  2. akos   December 6, 2008 at 3:30 pm

    Market for pick-ups in Europe and Japan is nil.
    Try parking your F-350 in NYC or Chicago.
    How many of us own boats?
    American SUVs are still largely truck based. Why do they suck if the trucks are so good?
    Perfect recipe to become a niche player and soon irrelevant.

    Reply
  3. Elele   December 6, 2008 at 6:52 pm

    Please don’t try to make the Big 3 local champions. Giving up all the market to dwell mostly on trucks is a washed-out idea.

    Reply
  4. mike   December 6, 2008 at 8:11 pm

    If you think $25 a gallon will hold…you are truly delusional. What are you going to do when everyone has trucks and then the price of gas spikes? It will, that’s what resources of finite quantity do. Supply and demand, friends, supply and demand.

    Reply
  5. trucklover   December 6, 2008 at 8:14 pm

    Absolutely brilliant.

    And in fact, the automakers implied the other day this is exactly what they are doing. Saturn? Gone!! Pontiac? Gone!! Many small Fords and GMs? GONE!! All money losers.

    There is just no point in making vehicles that lose money. It is stupid. Trucks are still the lead product!

    Reply
  6. big3orme   December 6, 2008 at 10:24 pm

    The reason the automakers make low end cars is to draw first time customers with cheap merchandise. It is difficult to entice a new college grad with a $40,000 truck. But they don’t come back if you sell them crap.

    GMs trucks are great, but they are stupidly expensive. Fords are great too, and more affordable, but still a rip. I think they need a great entry level truck that lasts like a Toyota Tacoma and has more style. If either one could pull off a nice 4×4 four door for 25K-30K with a great warranty, that would be a major winner.

    But they need something cheap (15K) in the truck line to draw that first buyer. And it better not be crap like the small cars they sell.

    I don’t think they can do it.

    Reply
  7. Jibreel Riley   December 7, 2008 at 11:42 am

    “Ford and GM make poorly designed and unpopular cars with the exception of a rare few”

    The tail end of your rant gets good however you gotta be from one of the “privilege coast.” Ford and GM has a very very very bad marketing problem that is all. I’m also going to flip if I hear more whining for hybirds and 50 mile mph cars anyone has took a physics class? Unless you want install a wind mast on top of your Honda, around 35 mph is all your going to get on pump gas. Oh and E85 is a (bleeping) joke and scam from the corn states.

    Reply
  8. Frank   December 7, 2008 at 4:08 pm

    The obvious problem not mentioned is they are required to meet certain fleet gas mileages. This is why Detroit made crappy economy cars they had to give away. (All their cars are not as bad as the author suggested but they do have a hard time competing with Toyota.) Now with Dingell out and replaced by a California congressman the laws will likely get even tighter.

    Reply
  9. jay   December 11, 2008 at 12:51 pm

    yeah, go ahead and invest 30k plus in a truck so in 1-2 years you get slammed by $4 gasoline again. this low price is going to be the last chance for that trip around the usa on the cheap. Oil will spike even higher next time as the big fields continue to decline and all the projects to expand production are put on hold. only someone who needs a truck work or is loaded should buy a truck. since sales fell off a cliff that is not the majority. I for one got rid of my used v8 this summer and will not go back as i now drive a toyota corolla. I will not even invest 15k in a car unless it get 30mpg around town because i don’t want to get stuck with the huge gas bill my v8 gave me. I miss the v8 but will not go back!

    Reply
  10. nick   December 12, 2008 at 12:00 pm

    To those who are saying that the low gas prices won’t last, I agree 100%; the question is only when, two years or twenty. The oil companies have done this each and every time people seriously start considering alternatives to oil. If you’re a cocain addict trying to break your addiction and I keep offering you a bit more on the cheap, it’s going to be harder for you to give up your habit. This is going to take a willpower and foresight greater than Americans are currently able to muster. The whole reason the car companies are in the trouble they’re in is a lack of foresight. Nothing stays the same forever and eventually a new more efficient transportation industry will replace the big three. The challenge is to have this new industry be one in which Americans can compete.

    Reply

Leave a Reply

Your email address will not be published.